Wallace: Understanding the alphabet soup of Medicare

We are in the middle of the Medicare annual enrollment period, which runs this year from Oct. 15 to Dec. 7. If you are over the age of 65, you usually will have a red, white and blue Medicare card. However, do you understand the alphabet soup of Medicare Parts A, B, C and D?

The original Medicare, and prior to 1997, the only Medicare, are Parts A and B. If you are receiving Social Security or Railroad Retirement Benefits, you typically are eligible to be enrolled in Medicare Part A at no additional charge. If you are not eligible for premium-free Part A, you can buy it during certain enrollment periods at a cost of up to $407 per month in 2015.

Part A mostly covers hospitalizations, certain home health services following a hospital stay, hospice care and rehabilitative skilled nursing care.

When you are enrolled in Part A, generally you also are enrolled in Part B, but at a cost to you. The monthly premium for Part B paid by most people in 2015 is $104.90. If your income is above a certain level, your monthly premium could be as high as $335.70. If you did not sign up for Medicare Part B when you are first eligible, then your monthly premium is increased by a late enrollment penalty.

Part B usually covers medically necessary services or supplies for the diagnosis or treatment of your medical condition and certain preventative services. These may include doctors visits, outpatient therapy, durable medical equipment, laboratory diagnostic services and home health services.

Even if you have Medicare Parts A and B, there are many medical expenses that are not covered. These include deductibles, co-pays, custodial long-term care and many listed non-covered services and procedures. Because of these non-covered expenses, you generally can buy a Medicare supplement private health insurance policy that will cover some of these expenses that are not covered by Medicare Parts A and B.

Medicare Parts A and B have been around a long time. Medical care providers know what they are going to be reimbursed for Medicare. Since 2003, if you are eligible for Medicare Parts A and B, you can opt-out of the original Medicare Parts A and B and have those replaced by Medicare Part C, also called a Medicare Advantage plan.

Part C Medicare Advantage plans were started in 2003 as part of the Medicare Modernization Act, the same Act that created the Medicare Part D prescription drug coverage. The Medicare Advantage program is essentially a repackaging of the Medicare+Choice program, which has been around since 1997.

With Medicare Part C Advantage plans, you have the private insurance versions of Medicare Parts A and B. If you have signed up for a Medicare Part C Advantage plan, you are no longer covered by Medicare Parts A and B, even if you have your red, white and blue Medicare card that says you do. Your Medicare coverage is now governed by the private health insurance contract you entered into with the insurance company.

There are numerous Medicare Part C Advantage plans around and coverages vary from state to state, county to county and plan to plan, even within the same insurance carrier. Medicare Part C plans are often preferred provider organizations (PPOs). If you incur non-provider or out of network medical expenses, you may have higher co-pays or no coverage at all.

Because many Medicare Part C Advantage plans had less covered medical expenses than Medicare Parts A and B and also because many had higher co-pays and deductibles, they were addressed in the Obamacare healthcare legislation. Medicare Part C Advantage plans are prohibited from charging higher cost-sharing requirements than original Medicare for certain covered services such as chemotherapy, dialysis and skilled nursing care

In addition, the federal subsidies paid to insurance companies who sponsor Medicare Part C Advantage plans have been cut. Consequently, it is reported that many insurance companies have increased Medicare Part C Advantage plan deductibles and co-pays.

Many Medicare Part C Advantage policies may not cover the same things as original Medicare Parts A and B. Some Medicare Part C Advantage plans have higher deductibles and co-pays than original Medicare Parts A and B. However, if you have a Medicare Part C Advantage plan, you cannot purchase a Medicare supplement or Medigap insurance policy to pay for non-covered medical expenses.

Starting in 2006, if you are eligible for Medicare Parts A and B, you are also eligible for a Medicare Part D prescription drug plan for an additional monthly premium paid to a private insurance company. There are numerous Part D prescription drug plans from which to choose and which have varying premiums, deductibles, co-pays and coverages.

Many Part C Advantage plans include the Medicare Part D prescription coverage as part of their plan. Be careful when you sign up for Medicare Part D prescription coverage so you do not unknowingly also sign up for a Medicare Part C Advantage plan. Many seniors have inadvertently signed up for a Medicare Part C Advantage plan when they thought they were only signing up for a Part D prescription drug plan.

In addition, if you do not enroll in Medicare Parts A, B or D when you are initially eligible, there is a penalty premium that you would have to pay when you eventually do enroll in these programs. In order to minimize your premiums, you may want to enroll in Medicare Parts A, B and D as soon as you are eligible. You may be able to get special help with your Medicare premiums if your income and/or assets are below a certain level.

You still have time until Dec. 7 to change your Medicare plan(s) by going online to the government website, www.medicare.gov. If you do not have a computer, or the website is overwhelming , or otherwise you would like assistance, you can make an appointment with a certified Michigan Medicare Medicaid Assistance Program (MMAP) counselor.

This year, four local organizations in St. Clair County have certified MMAP counselors on site to assist seniors during the annual enrollment period. The organizations are Lakeshore Legal Aid, The Council on Aging, Inc., Lake Huron Medical Center and McLaren Port Huron. Be wary of any Medicare “counselors” from any of the health insurance companies; they are likely to be health insurance sales people.

Lakeshore Legal Aid provides counseling on Medicare benefits by appointment at its offices located at 803 Tenth Avenue, Ste. C, Port Huron. Appointments are scheduled on weekdays, based upon availability. Most appointments can be scheduled within 5 business days of your call. To schedule an appointment with a certified MMAP counselor, please call (810) 985-5107, ext. 22. Lakeshore Legal Aid staff can also come to your housing complex or organization meeting to give a general informational presentation to senior groups.

The folks at The Council on Aging in Port Huron are assisting seniors in evaluating and choosing standalone Medicare Part D prescription drug plans that are not part of a Part C Medicare Advantage plan and are making appointments on November 12 & 18 and December 4. They are also making MMAP counseling appointments on other days during open enrollment to review Medicare Parts C & D plans and Medicare supplement policies. They can be reached at 810-984-5061.

Lake Huron Medical Center is also making MMAP counseling appointments during open enrollment to review Medicare Parts C & D plans and Medicare supplement policies. They are also giving 11/2 hour Understanding Medicare overview presentations on November 24 at 10am and 2pm. For appointments or to RSVP for the presentation, please contact their Senior Services Coordinator at 810-987-1035.

McLaren Port Huron is also making 1-hour 1-on-1 MMAP counseling appointments to review Medicare Parts C & D plans and Medicare supplement policies on November 17 and December 1 from 9am to 4pm. Call HealthAccess at 800-228-1484 or 810- 989-3199 to make an appointment.

With the tools that are available to you, you should be able to find the most appropriate coverages at the most economical prices to meet your health care needs.

Matthew M. Wallace is an attorney and CPA with the Wallace Law Firm, PC in Port Huron and can be reached at 810-985-4320 or at matt@happylaw.com.